ExpertHard1 markMultiple Choice
CPA · Question 54 · Area V: Entity Taxation
Which of the following entities reports its income on Form 1065?
Which of the following entities reports its income on Form 1065?
Answer options:
A.
C Corporation
B.
S Corporation
C.
Limited Liability Company (LLC) with 2 members (no elections made)
D.
Sole Proprietorship
How to approach this question
Identify the default tax form for a multi-member LLC (Partnership).
Full Answer
C.Limited Liability Company (LLC) with 2 members (no elections made)✓ Correct
A multi-member LLC is taxed as a partnership by default and files Form 1065. A single-member LLC is a disregarded entity (Schedule C). C Corps file 1120. S Corps file 1120S.
Common mistakes
Thinking LLCs have their own specific tax form (they don't; they use Partnership or Corp forms).
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